Shareholding Agreement
5 years ago
My client, Rhythm Equity Pvt Ltd, (Investor) is a foreign venture capital fund registered in India. They wish to make an investment by way of a fresh issue of shares into Blues Pvt Ltd, (Company) a company registered in India. Ms Aguilera, (Promoter) of the Company will continue to hold 73% of the shareholding post issue. In the course of their negotiations, the Investor suggests that they insert a clause into the SHA to be able to appoint two out of five directors on the Board. The Promoter notes that the provisions of the Companies Act 2013 provide for the majority shareholder to appoint the Board. The Investor seeks my advice as to whether the SHA can contain a clause for a particular shareholder to appoint directors, even if they are not majority shareholders.
Deepak Yashwantrao Bade
Responded 5 years ago
Rajender Prasad
Responded 5 years ago
Rajender Prasad
Responded 5 years ago
Rameshwar Dadhe
Responded 5 years ago
Please consult Charetered Accountant or Company Secretary
The best option for you would be to get in touch with an Advocate specialised in Company Law/Corporate Affairs/ Direct Foreign Investment capital to Indian market.In present situation the standard practice is majority share holders controls.None the less the law of the country,tax benefits,political and industrial climate also plays a significant role.
Shanti Ranjan Behera,
Advocate